Case Law Details
Pacharia Exports Private Limited Vs Special Commissioner (Calcutta High Court)
Introduction: The Calcutta High Court recently ruled on a crucial matter in the case of Pacharia Exports Private Limited vs. Special Commissioner. The petitioner contested an order by the West Bengal Taxation Tribunal, specifically challenging the denial of Input Tax Credit (ITC) concerning payments made to a third party instead of the selling dealer.
Detailed Analysis: The petitioner raised two primary grounds before the tribunal. Firstly, the Assessing Officer had initially allowed the ITC claim, but it was subsequently denied in the case of export transactions. The appellate authority later reversed this decision in favor of the petitioner. However, the Special Commissioner, under suo motu revision powers, set aside the assessment order, contesting the ITC claim.
The tribunal critically examined the jurisdiction of the revisional authority, emphasizing the powers vested in the appellate authority to modify assessment orders. It concluded that the Special Commissioner, acting as a Senior Commissioner and the Commissioner of Sales Tax, had the authority to exercise suo motu revision under Section 85.
The second contention involved the denial of ITC due to payments made to a third party on behalf of the selling dealer. The court upheld the well-established principle that ITC is a legislative concession subject to fulfillment of conditions. Rule 19(8) stipulates that payments must be made directly to the selling dealer by specified means, barring entitlement to ITC for payments made to a third party.
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